Leadership Development: Key Issues in Creating a Competent Leader - Research Paper Example

Running Head: LEADERSHIP DEVELOPMENT Leadership Development: Key Issues in Creating a Competent Leader BY YOU YOUR SCHOOL INFO HERE HERE Leadership Development: Key Issues in Creating a Competent Leader Introduction Historically, many organizations have taken a hard approach to managing people, with emphasis on planning, organizing and controlling employees. For example, in the 1940s and 1950s it was common for companies to operate using very centralized hierarchies and employees were viewed by management as assets, but only in terms of their productivity output with little to no emphasis on human capital development. In fact, in the 1940s, when renowned business theorist and strategist Peter Drucker suggested to corporate managers that employees were capable of shared decision-making and development, autocratic managers “were not amused” (Buchanan, 2009, p.2). However, with the presence of globalization in the business environment, increases in available job opportunities in multiple industries, and internal business needs for multi-talented workers to maintain competitive advantages, many organizations had little choice but to break-down autocratic management systems if organizational managers desired to gain employee commitment, loyalty and retention. This is the foundation of modern leadership, an evolution from command-and-control management that ultimately became rather ineffective in the late 20th Century. Leadership is a type of social persuasion which allows a manager to seek support and assistance from employees in the pursuit of attaining positive results with common projects and objectives (Nickels, McHugh & McHugh, 2008; Chamers, 1997). Leadership is an influential individual within the organization that creates a mission, coaches others, builds positive social relationships, and ultimately maintaining competency that allows for group organization and team-working. Leadership, as opposed to traditional management practices, is now a fundamental aspect of contemporary human resources systems and the method by which organizations guarantee higher levels of job satisfaction and intention to stay with the company. However, it should be recognized that not all individuals in the professional environment maintain the skills and competencies to become effective leaders. Therefore, organizations must identify potential strategies and procedures to develop leaders with the aptitude and capability to gain employee followership. To be an effective leader means developing skills that promote a genuine willingness to follow the direction of leaders within employees, a talent that is multi-faceted and complex based on psychological and sociological attributes and behaviors of employees. Furthermore, not all leadership strategies are productive and appropriate for every organizational culture, creating key issues in understanding what leadership development skills might be most practical and positive within the professional world. This research project identifies a variety of leadership ideologies and competencies that might theoretically lead to a more productive leadership philosophy in the contemporary organization. Key issues that are explored include strategies to retain employees, employee empowerment and knowledge management. These competencies seem to have significant importance in improving retention rates, improving organizational culture and teamwork practices, and providing organizations with more stable competitive advantages achieved through human capital development. Based on research findings, both through secondary literature analysis and primary research, it has been discovered that the aforementioned leadership traits are the most successful for developing effective and efficient leadership capability. Literature Review: Retention of Employees Organizations, today, want to retain employees. This is due to rising costs of training new hires, the consequences associated with losing employees familiar with the organizational objectives and processes, and even the complications of having fragmented job pools in certain industries that do not provide for adequate recruitment, such as in nursing and the construction industry. It is estimated that in the nursing profession, by 2016, nearly 55 percent of all nurses in the nation will be retiring (Hader, Saver & Steltzer, 2006). In this example industry, even with a median income level of over $65,000, it is becoming increasingly difficult to retain talent due to new mobility opportunities and also inability of clinical management to reduce the high levels of job stress, provide opportunities for empowerment, and generally satisfy workers (Craven, Hirnle & Jensen, 2013). The nursing industry is usually very centralized and there are monumental control systems designed to ensure employees comply with policy and procedure whilst being subjected to domineering management systems (Craven, et al). This leads to lack of commitment and job dissatisfaction, hence increasing social and financial costs of a high turnover ratio in this industry (Goswami & Jha, 2012). The aforementioned example of the nursing industry is only an illustration as to why leadership is important to more positive employee retention. However, how does an organization train and develop leaders to reduce employees’ intention to leave the organization? Goswami & Jha (2012) iterate that establishment of an appropriate feedback system could lead to better job satisfaction which, in turn, improves retention objectives of the organization. Feedback is a leadership competency requiring effective interpersonal communications skills and socialization skills to ensure the message is interpreted appropriately by the receiver. Feedback is the process of identifying an employee’s strengths and weaknesses, communicating these factors, and then rewarding the employee for effective job performance or building new training methodologies and development practices to build more productive talent. Leaders that do not have control over reward systems serves as the underpinning for significant retention problems and creates barriers to the achievement of quality job performance (McConville, 2006). The process of reward management is a fundamental aspect of today’s human resources strategies as being recognized establishes a positive employee perception of belonging and motivates an employee to be more productive in the hopes of achieving future rewards. In psychological theory, this is referred to as positive reinforcement within an operant conditioning model, the recognition that most individuals will repeat a behavior when the consequences of that behavior are applauded (Schacter, Gilbert & Wegner, 2011). Hence, this requires a leadership strategy in which managers work toward satisfying inherent employee needs at the psychological and sociological level. Kotter (2001) asserts that rewards motivate and establish belonging. Rather than utilizing managerial theory and practice as a means of gaining job role productivity, a strategy known to be ineffective with modern employees, managers use feedback and reward systems as a method of stimulating a perception that the organization legitimately cares about their contributions and development (Kotter). Concurrent with rewards strategies is the transformational leadership model, one in which effective and open communications channels are opened, managers set a vision and continue to reiterate this vision to gain enthusiasm, where the leader role models desired behaviors, and becomes a knowledge resources that also teaches employees new skills and competencies (Fairholm 2009; Eisenbach, Watson & Pillai, 1999). The ideological objective of transformational leadership is to establish a foundation of trust with employees as individuals or groups, using methods and processes that are aligned with the concept of being a person-centered leader. Transformational leadership ideology is theoretically effective as it establishes a sense of belonging within the organization (as aforementioned). Under psychological theory, nearly every individual in the world has a need for belonging and this must be established in order to obtain important self-esteem establishment and growth (Maslow, 1998). By being more engaging and socially-centric, the transformational leader makes people feel appreciated for their contributions which would theoretically motivate higher levels of job performance. Through consistent role modeling of desired behaviors, the transformational leader builds a sense of trust during leader-member exchanges which creates the willingness to follow. Trust in the leader is an important strategy for ensuring retention and has been cited as a reason for job dissatisfaction (Goswami & Jha). Trust is defined as being constructed as a result of reciprocal actions on behalf of the leader and the employee, “with both the employee and the employer voluntarily assuming responsibility for its initiation, development and maintenance” that lead to increasing affection and mutual respect (Starnes, Truhon & McCarthy, 2010, p.5). The transformational leader, using strong interpersonal skills, continues to build a rapport with the employee, showing sincerity and genuineness in all social and professional engagements. Coupled with teaching and coaching, loyalty toward the leader is established by showing a type of earnestness and authenticity that ultimately builds important trust and would theoretically reduce the employees’ intentions to leave the organization in pursuit of other job opportunities. Literature Review: Knowledge Management Knowledge management is a system whereby information is captured and effectively shared among disparate individuals within the organization. Knowledge is also developed through experience, tacit knowledge holders, and then made explicit through dissemination (Nonaka & Von Krogh, 2009). It is considered to be multi-disciplined activity in the organization. It begins with establishing communications processes. It should be recognized that tacit knowledge cannot be classified or transformed into information that can be understood by those who do not maintain the same expertise and experience of tacit knowledge holders without finding some level of shared meanings throughout the organizational culture. Knowledge cannot be developed, disseminated or transformed in a vacuum therefore knowledge management must require intervention between organizational members. Stover (2004) asserts that in order to provide effective knowledge transfer and inter-organizational comprehension of knowledge, engagement between organizational actors is absolutely necessary. With the aforesaid definition of knowledge management understood, it would require interpersonal communications skills within a leader, the ability to build team functioning, and ability to control conflict. Conflict control is an important element of knowledge management, theoretically, as there are some in the organization who will believe that relevant knowledge is based on fact and should be free and totally independent of personal beliefs and values. Other organizational members see knowledge as being developed mostly through social interactions and social systems which makes knowledge inseparable from personal beliefs and attitudes. When this type of disagreement becomes prevalent within the knowledge organization, conflict begins to develop about what constitutes the tangible value of knowledge. Knowledge management, then, becomes a legitimate political problem organization-wide with a potential power struggle developing when simply attempting to define the significance of a particular type of shared information between organizational members. Hislop (2009) asserts that in order to establish an effective knowledge management system, what is referred to as a knowledge culture must be developed. Differing personality characteristics and social beliefs create conflict therefore the knowledge culture ensures that everyone involved in knowledge-sharing maintains a positive attitude and mutual respect for differing perspectives on what defines knowledge. Hislop (2009) again iterates that this type of culture must be present to ensure that knowledge is transferred appropriately and translated/comprehended by those receiving it. This can be explained by constraint theory in psychology and sociology. This theory states that all humans have inherent biases that dictate learning processes. In constraint theory, people will deliberately or unconsciously block acceptance of information when they deem it to be irrelevant (Desforges & Lings, 1998). Therefore, in order to develop a knowledge culture of commitment free of the potential conflicts that could occur between disparate organizational members regarding the perceived relevancy of knowledge, leadership strategies are required. Specifically, group mentoring would theoretically seem to be the most viable method for gaining a holistic commitment to knowledge and knowledge sharing. According to Emelo (2011), the first step for the group being mentored is to establish a collaborative environment. People get to understand one another and their traits through this process and network effectively with the assistance of a group advisor (leader). In group mentoring, groups are functional and productive when there are clear learning goals established and a variety of very focused communications between peers in the group (Emelo). This builds camaraderie and also commitment to stay focused on learning goals and objectives (Emelo). Hence, using leadership strategies that show role modeled behaviors (such as those in transformational leadership ideology), building shared trust among members, and having a clear goal of defining the relevancy of knowledge would build the appropriate knowledge culture of commitment necessary to have a proper knowledge management system. Literature Review: Employee Empowerment Kotter (2001) states that when employees are granted opportunities to work free of managerial presence and control systems, it creates job satisfaction and job performance. This is the essence of autonomy and empowerment in employee environments. Chaudhry & Javed (2012) performed a study about the laissez-faire leadership style, a style in which there is very limited managerial presence and control in the workplace, and uncovered that autonomous working and empowered decision-making increases motivation. However, what is the linkage between leadership and empowerment? Participative leadership theory explains this correlation. Under this model, employees are actively consulted and given opportunities to express their unique problem solutions and innovations as part of a recurring organizational model. Markey & Townsend (2013) iterate that when employees are given opportunities to participate, which in turn empowers them, and when combined with consideration of their well-being, strategic performance is enhanced and job satisfaction occurs. This means that leaders must be empathic toward the psycho-social needs of employees and develop strategies that will better motivate through this process. The aforesaid assertion is supported by Ghosh (2013) who states that at the psychological level employees have an inherent need for recognition, authority, opportunities for job challenges, and to take on responsibility. Therefore, theoretically, leadership strategies that provide for more decision-making and general job role empowerment should create a psychological response, a positive one, that brings the organization better strategic outcomes and more committed and motivated employees. Chang and Chang (2008) found through a primary research study on employees in a participatory environment who were allowed to be empowered increased their intention to remain employed with the organization. Employees are starting to stipulate that leaders and managers consult and interact with the employee population, a type of intolerance against high levels of power distance between management and subordinates. Theoretically, when leaders actively confer with and seek advice from employees, it establishes a sense of empowerment. In psychological theory, when an individual achieves high levels of self-esteem, an outcome of productive empowered job roles, employees are able to achieve their highest pinnacle of self-actualization. Therefore, from a theoretical perspective, participatory leadership that provides opportunities for employee empowerment will build a more productive employee and establish a positive sense of commitment toward the leader and the organization. Research Methodology Throughout this research project, it has thus far been an examination and consultation with secondary literature regarding the theoretical strategies and proposed outcomes of leadership that build better retention strategies, establishment of effective knowledge management systems, and building employee empowerment. Many of the assertions identified in the literature review were constructed on tangible primary research and many the product of expertise from practitioners in domains of business, leadership and management, sociology and psychology. However, to determine whether leadership competency is directly correlated with effective knowledge management, employee retention, and empowerment, a primary study was required, representative of a mixed methodology of secondary and primary research. The research approach was qualitative rather than quantitative, as leadership is a multi-faceted and complex set of variables and explanations that are said to create outcomes both psycho-social and performance-based with employees. Henerson, Morris & Fitz-Gibbon (1987) indicate that measuring and evaluating attitudes is too complex to measure scientifically or statistically since catalysts for behaviors and beliefs are multi-contextual. Measuring attitudes quantitatively therefore becomes impossible, hence it was rejected as a viable research approach for this study. Qualitative research provides for a richer exploration of complex variables associated with leadership and its theoretical outcomes as well as more in-depth explanation. Therefore, the interview approach was determined as most viable for the study. Three interview questions were designed for a small-scale interview with two different organizational leaders in real-world business environments. The recruited participants included a project manager at a large manufacturing facility with seven years of tenure and a customer service manager at a medium-sized telecommunications servicing firm with eleven years of experience in this role. Access to these participants was secured through employees known to the researcher at both companies who facilitated agreement for participation in the interviews. Prior to confirming the interview, the researcher made contact with both participants to ensure they had experience with knowledge management, retention strategy developments, and empowerment. Each interview was scheduled for 30 minutes. The following represented the structured interview questions on the instruments: 1. As a leader engaged in knowledge management, can you name at least two different challenges that occur when trying to construct, transform and disseminate knowledge? How did/do you handle this when they occur? What leadership strategies did you implement as a method of handling the events? 2. What two factors, other than job mobility, would you say contribute to your employees’ intentions to leave the organization? Do you use any leadership strategies as a means of reducing turnover related to these reasons? If so, what might they be? 3. How does your organization empower employees? How do they respond? What would you say are the strategic and job role outcomes that are achieved through your unique empowerment strategies and what methods do you use to confirm results? The researcher made notes from both participants that generalized responses when comments were related to leadership ideology, strategy development, and any responses that discussed knowledge management, retention and empowerment. Results of both interviews were compared to determine whether there were correlations to real-world leadership and business practices as well as to the literature presented in the literature review of this study. Findings What was rather astonishing was the both participants identified problems in the knowledge management process that were equivalent to political conflicts. Participant one indicated that employees who worked on the production floor were often causing conflict with other organizational members as they believed non-technical knowledge was a waste of their time and activity to explore and comprehend. The company used a KM system where knowledge from procurement and even shipping and receiving were communicated at weekly meetings and internal marketing literature and then given to all members of the organization, including manufacturing. Participant two had a similar problem, asserting that the company intranet which was filled with information not necessarily relevant to the customer service division, but the electronic system had protocols and fail-safes that actually measured whether employees were opening and reading this information or dismissing it. Too many dismissals led to reprimand and the service division was growing increasingly aggressive about the relevancy of information to them and why they were forced to absorb and understand it on the Intranet. The manufacturing company leader used strategies not aligned with any theoretical actions identified in this study’s literature review. However, participant two in the telecommunications firm just recently called several meeting of managers within different divisions and employee representatives so that they could all discuss defining information relevancy. The manager had to reduce conflict using empathetic strategies and building a sense of collaboration and to allow different divisions to get to know one another on a personal level. This opened the floor for more active discussion, expression of concerns, and resolution toward defining the relevancy of knowledge to each department. This was absolutely aligned with the concept of using group mentoring as a means of building teamwork and the knowledge commitment culture. This strategy not only identified a proper definition of relevant knowledge for each department, but improved inter-organizational relationships between the service division and the rest of the organization; and a perceived sense of organizational performance enhancement through it. In terms of empowerment, both participants had unique strategies not necessarily aligned with the theoretical literature in this study’s literature review. However, both organizations and leaders believed that participation was critical to getting employees motivated. In fact, the manufacturing participant created a set of monthly problems and used what he called the Dephi Method, where all members of his production team brainstormed potential solutions in a group environment and where he served as an empathetic group mediator and advisor. Throughout a period of rounds, viable solutions and positive feedback and rewards for those who actually managed a reasonable and cost-effective solution were provided. This participant felt it improved his team functioning and build more respect for him. Participant two’s only participatory strategies included bi-weekly staff meetings and using styles that are essentially related to laissez-faire, allowing employees to be virtually completely autonomous in their job roles with limited managerial presence. This participant believed that the laissez-faire approach not only improved retention, but built a great deal of cross-functional skills development and much happier employees. The service business participant even indicated that her retention ratios were virtually zero percent as nearly all employees had been with the company for four years or more. In relation to retention, the manufacturing interviewee believed that his higher turnover rates were attributed primarily to job stress and poor human resources support. The service industry manager indicated that when employees actually did leave, it was usually due to pay and bonus problems as well as poor peer relationships. The leadership strategy offered by the participant was being more involved and visible to prevent bad peer relationships, a strategy more aligned with management thus not providing any valuable results to this study’s objectives of identifying what leadership strategies for development are most relevant in today’s business environment. In the customer service division, the participant called the group “catty”, meaning that it was regular for gossip and grudges to be present in the social environment between peers. This participant indicated that she tries to act as an inspiration, role modeling behaviors so that employees will adopt these same mannerisms by being professional and avoiding the chain of gossip that was widespread in her organization. This is akin to transformational leadership ideology, which was expressed in the literature review as being viable for retention improvements. Perhaps, through potentially unbeknownst to the manager in the service company, her actions as a transformational and inspirational leader was part of the catalyst for what ensured retention. This manager felt that these efforts were a reason why she had a great deal of respect and no problems whatsoever in gaining commitment from her employees. Discussion, Recommendations and Conclusions Based on the mix of secondary sources and primary research, it would appear that leadership is needed for empowerment, knowledge management and retention. Clearly, the most significant inter-dependency pertains to knowledge management. There is clearly going to be conflict about the relevancy and definition of knowledge and the methods by which it is disseminated; and to whom. Using group mentoring practices, facilitating collaboration and socialization as a group mediator, and building a committed knowledge culture will ensure an organization with an effective KM system. In terms of retention, it would appear that transformational leadership style should be taught to managers (or future leaders) to better engage employees. It seems to legitimately require inspiration, setting of a vision, communicating, feedback systems development, and role modeling of behaviors to effectively gain followership. This was supported by the interview and the secondary literature. It would be recommended for trainers to consult with appropriate knowledge sources on transformational leadership and then institute these concepts into a leadership training program. Finally, in relation to empowerment, it would seem there are a wide variety of potential strategies to empower employees. Both participants believed that participatory leadership style provided better outcomes for motivation and job performance, as was supported by the literature. Laissez-faire leadership, hence an absence of leadership, was effective in the service organization and shown through a legitimate research study in this literature review that this was effective, thus allowing employees to make their own decisions and maintain their job roles. It would be recommended, therefore, for today’s company trainers to teach leaders how to consider psychological and social needs of employees whilst maintaining a limited presence to give them perceptions of autonomy. 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